Exports rise aids trade surplus

A 3% increase in exports helped boost Ireland’s seasonally adjusted trade surplus by 8% in July, after three months of decline.

Newly-published trade figures from the CSO, show that the value of Irish exports grew by €184m — or 3% — on a monthly basis in July, to just over €7.33bn.

Coupled with a €61m — or 2% — drop in the value of imports, to €4.12bn; this meant that Ireland’s seasonally-adjusted trade surplus grew by 8% to €3.21bn.

The surplus had been gradually dipping for the previous three months — having gone from €3.6bn in March to €2.96bn in June.

On a year-on-year basis, however, July’s export value dipped by 3%, or €209m, to just under €7.6bn, mainly driven by a €301m, or 13%, fall in the value of pharmaceutical product exports.

Over the same timeframe, imports were up by €105m, or 3%, to just over €3.9bn. The EU accounted for 55% of Irish exports in July and 66% of our imports.

Despite the volatility in the multinational sector, prompted by the pharma patent cliff, commentators are relatively upbeat about Irish export growth.

Conall MacCoille, chief economist at Davy Stockbrokers, said that the patent cliff could hold back aggregate export performance, going forward, but “the bigger picture is that Irish trade performance appears to be slowly recovering”.

He said: “The underlying trend is that improving euro area conditions and global demand will help the more labour-intensive parts of the Irish export sector.”

Jobs and Enterprise Minister Richard Bruton called the latest trade figures encouraging, while Merrion Stockbrokers’ chief economist Alan McQuaid, said that while weak global demand has hit Irish exports in the last couple of years, signs that the global economy is picking up should augur well for the coming months.

He did strike a note of caution for the services sector — currently the best performing export bracket — exports from which fell sharply in the first quarter of the year.

Mr McQuaid is anticipating an average volume decline of 2%, for exports, this year; and expects the annual trade surplus to be down from just under €43bn last year to around €40bn.